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Order Code IB82008 CRS Issue Brief for Congress Received through the CRS Web Israel: Background and Relations with the United States Updated July 25, 2005 Carol Migdalovitz Foreign Affairs, Defense, and Trade Division Congressional Research Service ˜ The Library of Congress CONTENTS SUMMARY MOST RECENT DEVELOPMENTS BACKGROUND AND ANALYSIS Historical Overview of Israel Government and Politics Overview Current Political Situation Economy Overview Current Issues Foreign Policy Middle East Iran Palestinian Authority Egypt Jordan Syria Lebanon Other European Union Relations with the United States Overview Issues Peace Process Trade Aid Security Cooperation Other Current Issues Military Sales Espionage-related Cases Intellectual Property Protection U.S. Interest Groups Map of Israel IB82008 07-25-05 Israel: Background and Relations with the United States SUMMARY On May 14, 1948, the State of Israel rael’s vision of a Palestinian state remains declared its independence and was immedi- unclear. Israel concluded a peace treaty with ately engaged in a war with all of its neigh- Egypt in 1979 and with Jordan in 1994, but bors. Armed conflict has marked every de- never reached an agreement with Syria or cade of Israel’s existence. Despite its unstable Lebanon. It unilaterally withdrew from south- regional environment, Israel has developed a ern Lebanon in 2000. vibrant parliamentary democracy, albeit with relatively fragile governments. Prime Minis- Israel’s relations with the European ter Ariel Sharon formed the current three-party Union are important because the European coalition in January 2005 in order to secure countries collectively represent Israel’s second support for his plan to withdraw from the largest trading partner and a participant in the Gaza Strip and four small settlements in the peace process. However, Israel considers the West Bank, now scheduled to be implemented EU to be biased in favor of the Palestinians after August 15. Some observers are already and objects to its assuming an even larger role predicting an early national election some in the peace process. time after disengagement. Since 1948, the United States and Israel Israel has an advanced industrial, market have developed a close friendship based on economy in which the government plays a common democratic values, religious affini- substantial role. The economy has recovered ties, and security interests. U.S.-Israeli bilat- from declines experienced due to the Palestin- eral relations are multidimensional. The ian intifadah (uprising) against Israeli occupa- United States is the principal proponent of the tion and the international high-tech crash. Arab-Israeli peace process, but U.S. and Finance Minister Benjamin Netanyahu is Israeli views differ on various peace process attempting to liberalize the economy by cut- issues, such as the fate of the Golan Heights, ting the role of government. Jerusalem, and Israeli settlements. The United States and Israel concluded a free-trade agree- Israel’s foreign policy is focused largely ment in 1985, and the United States is Israel’s on its region, Europe, and the United States. largest trading partner. Since 1976, Israel has The government views Iran as a strategic been the largest recipient of U.S. foreign aid. threat due to its nuclear ambitions, and blames While the two countries do not have a mutual Iran for supporting anti-Israel terrorists. Israel defense agreement, they do have very close negotiated a series of agreements with the security relations. Palestinians in the 1990’s, but the Oslo peace process ended in 2000, shortly after the begin- Current issues in U.S.-Israeli relations ning of the intifadah. Israeli and Palestinian include Israel’s military sales to China, inade- officials resumed contacts after the death of quate Israeli protection of U.S. intellectual Yasir Arafat. Their immediate focus is on the property, and espionage-related cases. success of Israel’s disengagement from Gaza. Both sides have accepted the internationally- See also CRS Issue Brief IB85066, brokered framework for achieving a two-state Israel: U.S. Foreign Assistance and CRS Issue solution, known as the “Roadmap.” Yet, Is- Brief IB91137, The Middle East Peace Talks. Congressional Research Service ˜ The Library of Congress IB82008 07-25-05 MOST RECENT DEVELOPMENTS On July 11, Israeli press reported that Israel is requesting about $2.25 billion in special aid in a mix of grants and loan guarantees over four years, with one-third to be used to relocate military bases from the Gaza Strip to Israel in the disengagement from Gaza and the rest to develop the Negev and Galilee regions of Israel and for other purposes, but none to help compensate settlers or for other civilian aspects of the disengagement. On July 18, the Israeli Knesset (parliament), by a wide margin, defeated bills to postpone the disengagement. Finance Minister Benjamin Netanyahu and Education Minister Limor Livnat, who oppose disengagement and have ambitions for higher office, were absent from the vote. Most other members of Prime Minister Sharon’s Likud party voted against postponement. On the following days, police and soldiers prevented anti-disengagement protesters led by the Council of Jewish Communities in Judea, Samaria, and Gaza (Yesha Council) from marching from southern Israel to the Gaza Strip. On July 22, Secretary of State Condoleezza Rice visited Israeli Prime Minister Ariel Sharon at his ranch. She reportedly emphasized the importance of coordinating the Gaza withdrawal with the Palestinian Authority (PA) and using it to strengthen Palestinian President Mahmud Abbas. She also reiterated a desire to see disengagement form the basis of a renewed diplomatic process based on the Roadmap. BACKGROUND AND ANALYSIS Historical Overview of Israel1 The quest for a modern Jewish homeland was launched with the publication of Theodore Herzl’s The Jewish State in 1896. The following year, Herzl described his vision at the first Zionist Congress, which encouraged Jewish settlement in Palestine, then part of the Ottoman Empire. In 1917, the British government issued the Balfour Declaration, supporting the “establishment in Palestine (which had become a British mandate after World War I) of a national home for the Jewish people.” Britain also made conflicting promises to the Arabs concerning the fate of Palestine, which had an overwhelmingly Arab populace. Nonetheless, Jews immigrated to Palestine in ever greater numbers and, following World War II, the plight of Jewish survivors of the Nazi holocaust gave the demand for a Jewish home greater poignancy and urgency. In 1947, the U.N. developed a partition plan to divide Palestine into Jewish and Arab states, with Jerusalem under U.N. administration. The Arab states rejected the plan. On May 14, 1948, the State of Israel proclaimed its independence and was immediately invaded by Arab armies. The conflict ended with armistice agreements between Israel and its neighbors: Egypt, Jordan, Lebanon, and Syria. Israel engaged in armed conflict with some or all of these countries in 1948, 1956, 1967, 1973, and 1982. Since the late 1960’s, it also has dealt with the asymmetric threat of terrorism from Palestinian groups. In 1979, Israel concluded a peace treaty with Egypt, the predominant Arab country, thus making another multi-front war unlikely. Israel’s current relations with its neighbors are discussed in Foreign Policy below. 1 For more, see Howard M. Sachar, A History of Israel: From the Rise of Zionism to Our Time, New York, Knopf, 1996. CRS-1 IB82008 07-25-05 Government and Politics Overview Israel is a parliamentary democracy in which the President is chief of state and the Prime Minister is chief of government. The President, Moshe Katzav, is elected by the unicameral parliament (the Knesset) for a seven-year term. The Prime Minister, Ariel Sharon, is the leader of the Likud Parties in the Knesset party with the most seats in parliament. Party Seats The Israeli political spectrum is highly Likud 40 fragmented, with small parties Labor/Meimad 19 exercising disproportionate power due to Shinui 15 the low vote threshold for entry into Shas 11 parliament and the need for their National Union 7 numbers to form coalition governments. National Religious Party (NRP) 6 National elections must be held at least Meretz/Yahad 6 United Torah Judaism (UTJ)** 5 every four years, but are often held Am Ehad 3 earlier due to difficulties in holding Hadash/Ta’al 3 coalitions together. The average life National Democratic Assembly/Balad 3 span of an Israeli government is 22 United Arab List 2 months. The peace process, the role of religion in the state, and political * Elected as Yahad/Democratic Choice scandals have caused coalitions to break **Elected as Agudat Yisrael, 3, Degel Hatorah, 2 apart or produced early elections. As a result of the January 2003 national elections, there are currently 17 parties or blocs represented in the 120-seat Knesset. Sharon’s first government was a coalition of the right wing Likud, secularist Shinui, far-right National Union, and the orthodox Key Cabinet Officers National Religious Party (NRP). Ministers from National Union and Ariel Sharon, Prime Minister NRP resigned or were ousted because (also holds Social Welfare and of their opposition to Sharon’s plan to Science and Technology portfolios) disengage (withdraw) from the Gaza Shimon Peres, Vice Premier Strip and four northern West Bank Ehud Olmert, Vice Premier and Minister of settlements. Shinui was forced out after Industry, Trade, and Labor it voted against a budget to increase Silvan Shalom, Deputy Prime Minister and Foreign Minister funding for religious services and Shaul Mofaz, Minister of Defense schools designed to attract other Benjamin Netanyahu, Minister of Finance religious parties to a new coalition. Limor Livnat, Minister of Education, Culture, and Sport On January 10, 2005, Sharon Tzipi Livni, Minister of Immigrant Absorption formed a new government to ensure and Minister of Justice approval of his disengagement plan.
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